Nigeria launched a $10 billion infrastructure programme on Thursday in its restive Delta region as part of a plan to end an insurgency that has hobbled oil production.
President Muhammadu Buhari will meet representatives of militant groups and community leaders from the Niger Delta in Abuja next week in a bid to end the attacks, Oil Minister Emmanuel Ibe Kachikwu said.
Speaking to a forum in Abuja aimed at outlining strategy for the petroleum industry, Kachikwu described bringing the insurgency to an end as the first goal of a seven-point plan.
“Our target is to ensure zero militancy in the area,” he said. “This planned meeting shows the level of interest the president has to ensure peace in the area.”
The $10 billion investment is “not necessarily” going to come from the federal government, but rather from “oil companies, investors, individuals”, he said.
Militants fighting for a greater share of the OPEC member’s wealth complain of poverty and a lack of development across the Niger Delta region, where most of Nigeria’s oil is pumped.
The seven-part strategy also envisages passing a long-delayed Petroleum Industry Bill by December. The bill, which covers everything from an overhaul of state oil company NNPC to taxes on upstream projects, was delayed by violence in the Delta, which at one point cut production to 30-year lows.
The first part of the bill is already pending in the senate, and Kachikwu said the second part, which deals with fiscal aspects of the petroleum industry, is “almost completed” and will be presented to the oil industry in the next week or two.
While the government has emphasized diversifying the economy, Buhari said on Thursday it would be impossible to move forward without the oil industry.
“Oil and gas resources still remain the most immediate and practical keys out of our present economic crisis,” Buhari said, and the plan for the industry is “a national imperative and a core thrust of our economic policy”.
To drum up financing and oil investments, Nigeria will hold a roadshow in the Gulf in January and in the United States by mid-2017, Kachikwu told reporters.
One area of investment would be in improving outdated refineries to stop costly fuel imports, he said.
“We are going to be licensing private refineries, to look at investing in private refineries.”
Kachikwu said Nigeria’s oil output stood at 1.8 million barrels a day, compared with the 1.9 million bpd the Petroleum Ministry announced earlier this week. Still, he added that the government hoped to get back to 2.2 million bpd next year – the level seen at the start of 2016.
“We have a capacity to produce 3 million,” he said.
Credit: CNBC Africa